Wisconsin was recently identified as the sixth-worst state in the U.S. for unemployment payment fraud, according to a report released by the United States Department of Labor grading states on their accuracy in distributing unemployment benefits. | Adobe Stock
Wisconsin was recently identified as the sixth-worst state in the U.S. for unemployment payment fraud, according to a report released by the United States Department of Labor grading states on their accuracy in distributing unemployment benefits. | Adobe Stock
Wisconsin was recently identified as the sixth-worst state in the U.S. for unemployment payment fraud, according to a report released by the United States Department of Labor grading states on their accuracy in distributing unemployment benefits.
According to the report, which covers a three-year period from July 1, 2017, to June 30, 2020, Wisconsin's improper payment rate was 15.46%, significantly above the national average of 9.17%.
"We had a huge explosion in claims in 2020, but the actual cases in the state that were referred for fraud fell," Center for Research on the Wisconsin Economy at the University of Wisconsin-Madison economist Noah Williams told WPR. "We don't know how big the problem is, but I wouldn't have expected the absolute number of cases to fall."
The Payment Integrity Information Act (PIIA) mandates state unemployment programs to report an annual improper payment rate below 10%. Wisconsin did not meet this standard.
According to Tyler Tichenor, a communications specialist for the state Department of Workforce Development (DWD), which manages the unemployment system, "Wisconsin has been a national leader in detecting fraud."
"The department has a variety of means to detect fraud and abuse, including but not limited to auditing employer records, comparing benefit claims to payroll records in Wisconsin and other states, exchange of information between agencies, complaints from employers and tips from the public," Tichenor said.
Additionally, Tichenor noted that the department estimates it has stopped over $114 million in fraudulent payments since June 1.
"While we are unable to provide a more inclusive number due to a variety of factors," he wrote, "this number represents a very conservative estimate of the effectiveness of our fraud prevention strategies."
The report also coincides with recent developments involving a Nigerian information technology worker who was indicted on federal wire fraud and identity theft charges after allegedly submitting false claims for COVID-19-related unemployment benefits across 17 states, including Wisconsin.
Additionally, with Louisiana becoming the 26th state to eliminate increased federal unemployment benefits, Wisconsin has joined the minority of states that continue to pay the additional $300 in benefits to its jobless population, according to a Fox Business report, with an estimated 15.46% of these payments going to fraudsters.
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